Six months ago, the Johnson County Mental Health Center was struggling to meet payroll, and shortly thereafter it was at the heart of a lawsuit filed against the county commissioners.

But now, county officials say, the organization is making financial strides, and a district court judge has dismissed the suit.

The center today is “a stable organization with staff who are dedicated to providing the highest level of mental health services to our community, and who are taking great pride in figuring out what we need to do to be a financially viable organization,” said Assistant County Manager Maury Thompson.

In briefing the center’s community advisory board at its monthly meeting Monday, finance staff told members that:

Revenues for the first four months of this year were up nearly 40 percent, or approximately $1.3 million, from the same period last year

Current projections call for the center to have about $600,000 in reserves at the end of the year on a proposed $29.2 million budget for 2015. This year’s budget is approximately $28.4 million.

“The budget is extremely tight,” said Craig Schornheuser, the center’s director of operations. “We do question just about every purchase that comes through.”

Long haul

He said it could take as long as five years to build up reserves to the level expected by the Board of County Commissioners.

Using next year’s proposed budget, the center would need as much as $3.5 million in reserves to meet the benchmark of 8 percent to 12 percent of annual expenditures.

In January, the commissioners ordered a county audit of the center to include items such as billing, collection and fee structure.

The first phase of the audit is expected to be completed by late June or early July. Phase 2 should be completed by late summer, according to the county.

Issues at the center came to a head in October when the governing board placed Executive Director Maureen Womack on paid administrative leave for unspecified reasons.

Womack later resigned, and the county commissioners disbanded the governing board after an outside review concluded members had created “an unhealthy, unproductive atmosphere” within the organization and “demonstrated a lack of understanding of their roles and responsibilities.”

The commission assumed control as the governing authority and established the current 13-member community board as an advisory panel. It was the dissolution of the former board that spurred the lawsuit.

More trouble

Along with the personnel issues, the commission was facing a budget crisis at the center.

The commission authorized a taxpayer bailout of as much as $1 million so the center could pay its staff at the end of the year, though Thompson said the center ended up needing only about half of the authorized amount.

Thompson is serving as interim executive director of the center until the county hires a permanent replacement for Womack. Thompson laid out a hiring process Monday that would have a new hire in place by Oct. 1.

In reporting to the county in November, the outside reviewers described a staff that was unclear about roles and expectations and frustrated with conflicting information from leadership of the center.

In particular, staff complained to the review team about implementation of productivity standards for hours that could be billed to insurance providers, including Medicaid.

The reviewers faulted the administration for implementing standards without adequate training and with no consequences for failing to meet the benchmarks.

Booking billable hours is critical to improving the center’s finances, according to the review team report.

Productivity

Thompson said he has worked with the staff to establish productivity standards that they believe are workable. For example, he said, the center expects psychiatrists to be able to bill for five hours of every eight hours worked.

Thompson said increased staff morale and clearer view of expectations helped drive the improved financial performance of the center in the first third of this year.

“People are saying, ‘We know we can figure this out. We know we’ve got the skills and abilities to be able to provide the highest level of service in a financially sound manner, and we are committed along with you to making sure we do that.’”

Thompson said he and the staff are also working to welcome all clients to the center, after the outside review team concluded that the mentality of the staff seemed to be one of a pure safety net provider that appeared to be “doing everything it can to deter or push away ‘paying customers.’”

Case dismissed

The lawsuit was filed by Ken Dunwoody and Benjamin Hodge in Johnson County District Court in February. They argued that the commissioners’ action in dissolving the mental health center governing board violated the county charter.

Dunwoody is a county resident and Hodge was a member of the governing board.

In disbanding the board, the commissioners cited a state statute that allowed them to appoint themselves as the governing board of the mental health center.

Dunwoody and Hodge argued that the home rule charter required either the passage of a charter resolution by the commissioners or a proposed charter amendment, which would be subject to approval by county voters.

On May 13, Judge Thomas Sutherland granted the county’s motion to dismiss the case.

Sutherland ruled that, since the county did not have the authority to exempt itself from state statute in a home rule charter, the commission acted appropriately in following state law to disband the governing board.

Plaintiffs respond

Dunwoody said he was satisfied that he and Hodge got their day in court.

“I respect the courts,” he said. “They made a decision on it, they ruled on it, and it was legal.”

In an e-mail, Hodge said the ruling was “a punch in the gut to the original Charter Commission members, whose words are now watered down and made almost meaningless.”

Personally, he said, he agreed that the elected commissioners should have the authority to easily replace and add members of boards overseeing agencies and organizations that receive millions of dollars of taxpayer dollars.

He said he would have accepted whichever way the ruling went and that the litigation provided “needed clarity to county voters.”

At Monday evening’s meeting of the new advisory board, county Commissioner Ed Peterson told board members that the commission was “very pleased” with the work of the groups.

Board member Jane Fletcher, an Overland Park woman who has experienced mental illness in her family, said she was honored to be part of a group that included such talented and dedicated individuals.

“I have a lot of hope for what Johnson County Mental Health will be a year from now and five years from now,” she said.

Correction: An earlier version of this story provided incomplete information about the audit of the mental health center.